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Ontario enacts protection for wireless customers

Legislation allows consumers to cancel a contract after two years without charges other than for remaining payments on a handset purchase.

The cost of cancelling a fixed-term agreement is now capped at $50 and phone companies will need customer consent before amending, renewing or extending service terms, under new Ontario legislation.
AP PHOTO

The cost of cancelling a fixed-term agreement is now capped at $50, and phone companies will need customer consent before amending, renewing or extending service terms.

Carriers who do not comply must give consumers who cancel their contracts a full refund for up to a year of service.

Providers must also show the minimum monthly service charge in their ads — if they are advertising any costs — and the most prominent price must be the all-inclusive cost.

The legislation allows consumers to cancel a contract after two years without charges other than those for remaining payments on a handset purchase.

Similar laws have already been passed in Quebec, Manitoba, Newfoundland and Labrador and Nova Scotia following a spate of consumer complaints about unclear cellular service contracts, arbitrary charges and excessive contract durations.

Minister of Consumer Services Tracy MacCharles said the “made-in-Ontario” solution would complement the federal CRTC’s wireless code that laid out national rules on contract terms, usage fees, data limits and unlocking phones.

She said the difference is stronger enforcement mechanisms than those provided by the CRTC code, with fines of up to $50,000 for individuals and $250,000 for companies.

“Ontario has enshrined the rights of cellphone, smartphone and tablet users in legislation — not a code,” she added Wednesday during an event at a Wind Mobile store in Toronto proclaiming the new law.

The Canadian Wireless Telecommunications Association during hearings on the CRTC code last year urged the watchdog to take national responsibility for regulating consumer cellphone contracts.

Canadians “would be best served by a single set of regulations, not today’s patchwork of provincial laws, regulations, guidelines and interpretation bulletins,” said CWTA president and CEO Bernard Lord.

He urged the commission to adopt a code that “supersedes any current or future provincial legislation in this area.”

“Every layer of regulation you add, adds cost. And eventually that cost is paid by someone and that someone usually ends being the consumer,” he said.

“So we feel having one set of rules across the board best serves consumers because it provides clarity and certainty and also reduces cost.”

Bruce Cran, president of the Consumers’ Association of Canada, said in cases of dispute federal rules would trump provincial legislation.

He added that the Ontario law will sow confusion among consumers, who will be unsure about where to direct their complaints and which level of government has jurisdiction.

“Instead of harmonizing (the provinces) are trying to outdo Ottawa and each other,” he said.

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